AML Weekly – 7 June 2021

In this report we observe and track all relevant events that have unfolded in the Anti-Money Laundering (AML) and digital asset space in the past seven days.


It has been an exciting week as in the digital asset and anti-money laundering space as Musk is at it again with his proposed breakup tweet that kicked the bitcoin price while it was already down. Pursuant to the Tesla’s CEO tweet, the bitcoin price fell by $2.6K and it is again slowly trying to make its way up. The Bitcoin 2021 conference, has come and gone, which caused a great initiative to emerge from Progressive Care as it announced that the Company is now accepting bitcoin as a form of payment for its COVID-19 Rapid Testing services.

China has now launched its own copyright blockchain which aims to protect digital copyrights with increased efficiency at reduced costs. The Copyright Society of China (CSC) says that the tech will only enhance copyright as it provides features such as “immutability, source-tracing … and distributed consensus.” All eyes are now on Africa where tremendous momentum around cryptocurrency adoption has been reported, as Paxful has approximately 1.5 million users and $1.5 billion in trade volume from Nigeria alone; despite the Central Bank of Nigeria (CBN) ordering all of its banks to close accounts of all crypto holders.

The West Midlands Police Department raided an industrial building under the pretence that they will discover a cannabis farm; however, discovered a cryptocurrency operation that used stolen electricity to mine bitcoin. Argo Blockchain is making waves as it has mined 166 bitcoin last month, taking making the total coins mined in surplus of 1,000. Marathon Digital Holdings’ (MARA) hosts a new mining pool which according to it is fully compliant to the US regulations as it excludes transactions against sanctioned countries and actors involved in dark web activity.

The core values of MARA are to: “provide investors and regulators with the peace of mind that the bitcoin [they] produce is ‘clean’, ethical and compliant with regulatory standards.” As this might be a great initiative from an anti-money laundering (AML) and compliance perspective, the question begs whether this does not go against the grain of what bitcoin is all about. Only time will tell as new CEO Fred Thiel is confident that the pool shoots straight: “Marathon is committed to the core tenets of the Bitcoin community, including decentralization, inclusion, and no censorship.”


In the US, lawmakers have urged companies not to release digital assets to cybercriminals in exchange for access to their data, as this may introduce a dangerous president and “will put an even bigger target on the back of critical infrastructure.” Belt Finance a decentralized finance (DeFi) has undertaken to compensate users following a hack that earned the perpetrator $6.23 million. The flash loan attack resulted in an overall $50 million loss for the platform as the incident report showed that the attack was initiated on the BSC 4Belt and proceeded to execute the contract 8 times for a total profit of 6,234,753 BUSD. Despite the fact that it is concerning for the platform’s security protocols, it has taken full responsibility and remains committed to compensate the affected users.

The Office of the Comptroller of the Currency (OCC) is in the process of “reviewing all of the digital asset guidance issued under the leadership of former Acting Comptroller Brian Brooks,” with the overarching theme of identifying risks and planning for future regulations of digital assets. Progression is inevitable, as the European Union (EU) has now announced plans for a digital wallet to store passwords and payment details, allowing access to local government websites and bill payments using a single digital identity.

The Financial Conduct Authority (FCA) has recently imposed additional AML and to date only five crypto firms have been admitted to the FCA’s register. The reasoning behind the additional and more stringent AML regs piggy backs on the global trend of regulators cracking down on persons and entities linked to ML dealings. The FCA’s initial deadline for registration in terms of the Temporary Registrations Regime (TRR) has now been extended to March 2022, which allows non-compliant platforms to register and become compliant. To rub salt, the FCA has warned that more that 50 platforms might need to close up shop as they are not meeting its standards on AML. Belarus’ national airline is being hit by sanctions, asset freezes and travel bans as part of new sanctions from EU on Belarus.


Banks are now looking at sharing information in an attempt to give more access to credit for the general population. The move away from the traditional banking silo approach might again be an indication of eyes opening and the bigger impact that DeFi has brought into our traditional. JPMorgan Chase & Co is bolstering its crypto readiness on multiple fronts as the bank is hiring aggressively in its compliance, regulatory and payments positions.

UK’s Starling Bank who previously imposed temporary block on user payments to crypto exchanges as it suspected “high levels of suspected financial crime with such payment” has now undertaken to resume cryptocurrency exchange deposits on 23 June 2021.The bank is in the process of upgrading its security systems and: “the introduction of an enhanced payment review process. The block only affects outbound payments, inbound payments in GBP are unaffected.”

As South Kora is imposing more stringent guidelines on digital assets to regulate money laundering and fraud it is also now following the global trend to close the tax gap in looking into taxation of digital assets held in foreign exchanges which exceeds $450,000.00. The digital banking alternative Revolut has started requesting users of its mobile phone app to provide their tax residence details and taxpayer identification numbers.


A member of the Trickbot Group has been charged with 19 counts by the U.S. Department of Justice (DOJ) for her alleged involvement in the group that operates globally to harvest banking credentials and deliver ransomware. At the Port of Dover, border officials found 100kg of cocaine in two spare wheels of a Polish lorry driver. The NCA Branch Commander said that “[w]e have seen a number of cases recently where drug runners have attempted to bring class A drugs into the UK, but have been stopped at the border and arrested.” This follows a nationwide clampdown where the British Transport Police (BTP) joined the UK Police and seized 15 lots of drugs, £6,200 in illicit cash, eight weapons, 42 phones and identified two drug lines.

David Udegbue, a notorious drug smuggler handed himself in the UK and admitted importing nearly half a ton of cannabis. A chief justice in Albania is being investigated via a lifestyle audit, following a sure of post on tick-tock of her lavish lifestyle and her in posing in designer clothes. This comes after a call for Albanian judiciary to be audited for possible connections with organized crime groups. It is alleged that the Restaurant Revitalization Fund (RRF) has been hit with fraud as $26.8 billion allocated, has now almost been depleted. Despite warning signs, politicians are gearing up to refund the program. In Germany, Health Minister Jens Spahn is now in consultation following the identification of a fraud scheme at a COVID-19 test center. The fraud was uncovered after a company carrying out rapid antigen tests that reported to insurance more tests than were actually performed.

Following the conclusion of operation Stork Nest, Czech police ask for Prime Minister to be charged with fraud. The investigation into the Stork’s Nest resort that received EU funding intended for small and medium businesses between 2007 and 2013 found that the Prime Minister breached conflict of interest rules over his control of trust funds linked to Agrofert. Two Russian citizens have been charged on suspicion of ML, following the seizure of €400,000 from the income of an apartment sale in the Belgian city of Antwerp. On the sentencing front, a Westminster magistrate has rule in the interest of open justice that the identities of a couple involved in laundering £14m should be named.


In this week’s report it is clear that there has been more focus on the integration of regulation in the digital asset space as ransomware is on the lips of lawmakers and a strengthening of border posts in the EU is imposed to prevent smuggling of illicit goods. On the tax front, governments are widening the base by forcing certain entities to disclose their foreign digital assets and compelling exchanges to share tax information.

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